| Asset Based Lending |
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This type of lending is usually done when the normal routes of raising funds, such as the Capital Markets (selling bonds to investors) or normal unsecured or mortgage secured bank lending is not possible. This is usually because the company is in dire financial status. Thus, asset based lending can be compared to Sub-prime Lending . It is usually acompanied by high Interest Rates , and can be very lucrative for the parent company. For example, the bank Wells Fargo made more money from asset-based lending business then it did the rest of its corporate business (both lending and fee based services). In fact, many ). Most financial services companies now only lend as part of a package of services, or do asset based lending or other more lucrative businesses. Asset based lenders are known for taking out Tomb Stone ads in much the same way as Investment Bank s. SEE ALSO |